Gold markets have rallied a bit into the weekend as Friday was positive yet again. That being the case, it makes quite a bit of sense that people are going into the weekend buying gold because of the fear of potential headlines out there that could come along and chew up risk appetite. Ultimately though, I see the $1600 level above has significant resistance, so it’s not until we break above there that I am truly impressed for the bigger move, but in the short term I do like buying little bits and pieces as building up a core position makes quite a bit of sense.
Price of Gold Video 17.02.20
The 50 day EMA is sitting just below the $1550 level, as it is an area previous support as well. In other words, I would be very interested in buying gold down at that level if we get that low. If we break down below it, then it opens up a move down to the $1500 level potentially. By the time we get down there, it’s very likely that the 200 day EMA will meet that region rather quickly, offering the ability for even more support. Breaking that of course would change the entire trend. In the short term, I like buying dips, but I also recognize that the $1600 level is crucial on longer-term charts, and therefore it’s going to take a lot of work to get above there. Loose central bank policy continues to lift gold though, right along with those fear-based headlines out there that continue to throw things around.
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This article was originally posted on FX Empire
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